India buys sunflower oil from Russia at record-high price amid shortfall

Even as western countries are imposing sanctions on trade with Russia over its invasion of Ukraine, India continues to make deals with the largest country in the world.

The latest deal is for 45,000 tonnes of sunflower oil that India has contracted with Russia. This is apparently to meet the shortfall brought about by the stoppage of supply of the product from Ukraine, which has been ravaged by war, a Reuters report said.

Interestingly, India has made the deal for a record high price of ₹1.6 lakh a tonne, which includes cost, insurance and freight (CIF), as compared with ₹1.2 lakh earlier.

The supplies are set to arrive in India in April. “As vessel loading is not possible in Ukraine, buyers are trying to secure supplies from Russia,” said Pradeep Chowdhry, managing director of Gemini Edibles & Fats India Pvt. Ltd, which contracted 12,000 tonnes of Russian sunflower oil for April shipments, according to the Reuters report.

Before the war started, India used to buy sunflower oil from Ukraine (70% of sunflower oil imports), Russia (20%) and other countries. Domestic production has been stagnant at around 60,000 tonnes for several years.

Also read: India, China agree on need for immediate ceasefire in Ukraine

According to 2019-20 data, India’s total edible oil consumption was 25 million tonnes, with domestic production helping meet 10.53 million tonnes of demand and the remaining 14.46 million tonnes being imported. This included 2.5 million tonnes of sunflower oil, of which 70% came from Ukraine and 20% from Russia.

A few days back, Finance Minister Nirmala Sitharaman had also said that India is looking at other places from where it could import sunflower oil from, acknowledging the shortfall faced by the country due to the war in Ukraine.